Question

What defines capitalism as a socio-economic system?

Answer 1

In simple words, capitalism is a socio-economic system based on the private ownership of the means of production and a free market. The central characteristics of capitalism are private property rights, accumulation of capital, wage labor, voluntary exchange of goods, services, labor, etc. price mechanism and the free market. In this type of a system, decision-making and investments are made by individuals participating in the market rather than any central authority. The price system determines which goods and services are produced and who receives them.